Abstract

Starting from reviewing two standard essential patent (the "SEP") related cases in which the Chinese courts issued the anti-suit injunctions, this note categorizes the approaches applied by the Chinses courts into two folds, the substantial one and the formal one. In this note, the substantial approach, which is a progressively embracing of law and economics analysis, can satisfy the need for the emergence of more pro-implementor judicial forums to rebalance the asymmetrical negotiation power between the patentees and the implementors.

Introduction

The newly emerging practices of Chinese courts issuing anti-suit injunctions ("ASIs") in SEP disputes, as represented by the two cases (Huawei v. Conversant, Xiaomi v. InterDigital), have reflected a two-fold nature: on the one hand, progressively embracing of law and economics analysis, and on the other, conservatively sustaining the traditional requirements of international comity and jurisdictional sovereignty. The first fold of "substantial" approach hints at the possibility for creating a pro-implementor forum that rebalances the interest and bargaining power between the patentee and the implementor (thus "leveling the playing field"), contributing to the vitality and efficiency of an IP system consisting of diverse international jurisdictions. In the contrast, the second fold of the "formal" approach only plays a role with lessening significance in this potential new order of international SEP litigation.

This note begins in the second section with an overview of the two ASI-issuing decisions, Huawei v. Conversant and Xiaomi v. InterDigital. In the third section, this note categorizes and compares the two bi-existing approaches reflected in these Chinese courts' decisions, the first being the substantial one (reflected in the "overlapping subject matter" element and the recognition of jurisdiction) and the second being the formal one (reflected in the "first-to-sue" requirement and the judicial sovereignty argument). The fourth section reviews the arguments regarding patent holders' inherent bargaining privilege as granted by injunction orders, applies these arguments to the SEP context, and argues for the emergence of more pro-implementor judicial forums to rebalance the asymmetrical negotiation power. It is then evaluated that the "substantia" approach could better suit such need for pro-implementor forums and shall play an important role in future international SEP litigations, negotiations, and judicial innovation.